How to Identify Real Estate Hotspots #06: The Stayers

While buying property influenced by the Boom Towns syndrome can be risky, buying Stayers is one of the safer options.

Many property consultants, including buyers agents and valuers, advise investors always to buy property in the tried-and-proven areas. These often are city suburbs with long-term records of steady growth in values – the ones that perform steadily year-in year-out.

According to conventional “wisdom”, they’re usually suburbs close to the City centre, or down by the water.

But conventional wisdom often proves to be myth. Hotspotting research shows that high-priced city markets are often volatile and can deliver inferior long-term capital growth rates.

Our definition of a Stayer is any location which maintains value through all stages of the cycle. They’re as likely to be a regional centre or an outer city suburb as a “prime” inner-city enclave.

These places may not have shown the strongest growth in the last 12 months, but they will perform steadily over five or ten years.

Currently around Australia, there are towns and suburbs which sell consistent numbers of houses, month after month, quarter after quarter.

Buderim, a suburb of the Sunshine Coast, consistently sells 250 to 260 houses per quarter. Sunbury, a suburb of Melbourne, sells 180 to 190 houses quarter after quarter.

These markets fit our definition of “Stayers”. If you’re an investor who doesn’t like to take risks, The Stayers are a good option.